Fears for small companies in EFSA funding row
processing of dossiers required under EU legislation has raised
fears over the financial burden this would place on small and
medium enterprises in the health and nutrition sector.
EFSA (European Food Standards Authority) revealed at the end of last month that it could be facing a budget crisis, after the EU Council proposed capping the budget for the 3B heading, under which EFSA falls, at €220 million for the period 2007 to 2013.
Sue Croft, director of Consumers for Health Choice, called the idea of charging fees to make up a budget shortfall "disgraceful", and said that it is the result of bad planning and bad management at some level.
An EFSA spokesperson told NutraIngredients.com that the annual budget for 3B was €220 million in 2006 (of which €46.6 million was allocated to EFSA). It was originally forecast that this would increase over time, to €290 million in 2013.
However the Council's proposal to cap it €220 for 2007 to 2013 places EFSA in a conundrum over how much it should request in its 2007 budgetary forecasts, due in March. The authority is still in its growing phase, and needs an appropriate budget to support that growth.
"Freezing the budget at current level will inevitably affect [EFSA's] ability to provide the scientific basis for legislation in the area of food and feed safety, which is its raison d'etre," wrote EFSA chair Stuart Slorach and acting executive director Herman Koeter in a letter dated January 27 to Borrel Fontelles, president of the European Parliament.
The EU Parliament is expected to take a final decision on the budget in March.
The introduction of fees is only one possible approach to the possible budgetary shortfall that has been flagged by EFSA.
"This is an issue that is still under discussion," said the EFSA spokesperson. "It will take up to two years to be agreed upon, and it wouldn't be seen as the solution."
There is not yet any indication of the level of fees if EFSA does go down that route. But Croft said: "However much, it would be too much."
Consumers for Health Choice argues that the charging of fees would create an unlevel playing field, with major companies being able to afford them but not smaller, more specialist ones.
As well as leading to market homogenisation, an upshot of this will be that consumers will miss out, said Croft. Either manufacturers will cover their costs by raising prices, or they will withdraw the products from the market.
Companies already have to bear the costs of compiling a dossier to meet the requirements of regulations like Food Supplements Directive and Novel Foods legislation, and the Regulation on Nutrition and Health Claims Made on Food, currently in draft. This can cost as much as £250,000 (€364,000) and take up to two years.
"In some cases it has brought smaller companies to their knees, just to keep their product on the market. It is almost like blackmail," said Croft. "To ask more could put smaller, more specialist companies out of business."
Since the Herbals Directive became law last August, UK companies will soon have to start paying fees for the processing of herbal medicine registrations to the MHRA. According to Croft, some small companies are sitting back knowing they will have to close when this time comes.
